Posted on January 11, 2009 - by admin
This is for you economists out there-do you think the real estate boom of south florida will end?
superjr asked:
Can the middle class afford to live in South Florida anymore?
Almost $1000 rent for a one bedroom apt?
Will real estate go back down where an average person can afford to buy?
Winter Sports Bulgaria
Can the middle class afford to live in South Florida anymore?
Almost $1000 rent for a one bedroom apt?
Will real estate go back down where an average person can afford to buy?
Winter Sports Bulgaria
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January 13, 2009
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You’re a little behind, the boom has ended and the market has crashed, at present nobody can sell any real estate because no one is buying it. The prices are falling dramatically to compensate for this.
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January 15, 2009
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The areas closest to the ocean will never really go down. The rich will continue to push prices up over time.
Which means the rest of the people get pushed farther away from the most desirable areas.
There’s too many people with too much money willing to pay high prices for warm areas with great views and access to amenities like the ocean.
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January 15, 2009
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As previous writers have mentioned, the real estate boom has ended. Now, the big question is whether prices will fall by a little or a lot.
No one has the answer.
However, it is useful to understand some of the underlying factors that affect the real estate market.
First, the Federal Reserve has significantly lowered interest rates over the past few years. Even though they are a bit higher today than they were a year ago, interest rates are significantly lower than they were 5 years ago or 10 years ago. Lower interest rates mean lower mortgage payments (which are largely interest rate payments). This makes housing more desireable, and prices will be pushed up as more people can take on mortgages.
New home builders have to make decisions far in advance about how many homes to build. It now appears that builders erred in building too many homes. New construction is strong, and new homes will coming onto the market for several months into the future. This factor would tend to push down prices.
A final factor is speculation. Many folks saw prices going up, and decided to buy homes before prices got even HIGHER. This type of speculation tends to push up prices even more. Since this type of activity now seems to have disappeared, the housing market will be even softer.
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January 18, 2009
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Not Sure!
Keep in mind………..
Times and markets are changing!
In California with average homes selling well over $500,000, a 20% decline is $100,000! In any market ‘timing is everything’! So, could you afford a loss of 25% of your investment all because of poor timing???
This last up cycle was 10 years in many parts of the country. The downcycle now started in CA, Wash DC, NYC, Vegas and other hot areas of the past are all soft and getting softer.
From 1990 to 1996, the average home in San Diego lost 20% of its’ value! The cycle we are now enterng looks like it could well exceed that on the downside!
With all the 100% financing, interest only loans, EZ qualifing etc…even a slight decline will cause many to be unable to sell for the amount due on their loans!
For some great ‘insider’ articles on the San Diego real estate market, which I beli
eve will apply to any of the hot real estate markets of the past five years…..visit: